By the end of his term, inflation had been reduced to 7% in 1994, the lowest figure in 22 years. Shortly after leaving office, due to the so-called December Mistake, inflation rose again to 51%.
The 1994 elections were the first to have international observers, and were considered, at that time, the fairest elections in the century, although not free of controversy. For the first time, the PRI lost its two-thirds majority in Congress, which is necessary to conduct constitutional reforms.
The centerpiece of Salinas's presidency was his successful negotiation with the U.S. and Canada to create the North American Free Trade Agreement (NAFTA), which came into effect on 1 January 1994. The agreement was a reversal of Mexico's longstanding policies of economic nationalism and anti-Americanism and was intended to create a single market. Mexican proponents of NAFTA saw it in a way to secure markets for its exports and attract foreign investment, and create jobs, help the government to be able to service its foreign debt, and overall, promote economic recovery. In Mexico, the reversal was controversial, opposed by organized labor, many academics, and nongovernmental organizations.
As the 1994 presidential election approached, Salinas had the crucial decision to designate the candidate for the PRI; that person had always gone on to win the presidential election. "The shipwreck of the 1988 succession should have sufficed to teach Salinas to prevent another disaster from befalling the system he had inherited." At the time Salinas made the choice, popularity and credibility was high over the course of his presidency, but a series of events in the final year of his presidency changed that.
The uprising in Chiapas on 1 January 1994 coincided with the date that the NAFTA came into effect. The Zapatista Army of National Liberation (Ejército Zapatista de Liberación Nacional, EZLN) issued their first declaration from the state of Chiapas in southern Mexico. Salinas's immediate response was to find for a peaceful solution: offering pardon to deposed arms; ordering a cease fire; appointing a peace negotiator, and sending Mexican Congress a General Amnesty Law. Salinas's presidential successor took a harder line when he was inaugurated. But Salinas's more peaceful solution Zapatista uprising was legal and politically pragmatic, likely saving many lives in Mexico. The Zapatista rebellion did not spread regionally or nationwide, but the fact that it happened and that international attention was drawn to this poor region of Mexico just as NAFTA was implemented meant that Salinas's careful plans for a peaceful political transition with his legacy intact were obliterated. Salinas appointed Manuel Camacho, Minister of Foreign Affairs, as the government's peace mediator. For Salinas, this had political benefits, since Camacho, having been passed over as the PRI presidential candidate, could have bolted from the party. With this important appointment, he was in the public limelight again.
A spectacular political event of 1994 was the assassination of Salinas's handpicked PRI presidential candidate Luis Donaldo Colosio in March 1994, upending the already complex electoral situation with elections scheduled for August 1994. The Zapatista uprising had ruined Salinas's plans for a peaceful transition of Mexico in the elections. There is evidence that Salinas and Colosio began to disagree, not unusual after the electoral transfer, but this occurred prior to it. His campaign languished with lack of funding, Colosio had problems getting media coverage, given the high-profile events in Chiapas. Salinas prevented Colosio from going to Chiapas, while the explanation that his presence there would complicate the situation. Increasingly there was the impression that Salinas would reverse his decision for Colosio, substituting someone else, perhaps Manuel Camacho. Camacho was a politically savvy former Minister of Foreign Affairs, Head of Government of Mexico City as well as Peace Commissioner in Chiapas. Salinas made a public statement on 17 January 1994, affirming his choice as candidate, but this was at the insistence of Colosio. Salinas extracted a pledge from Camacho that he had no designs on the presidency, which he renounced the day before Colosio's assassination in Tijuana 23 March 1994. After a few days of weighing his options, Salinas chose Colosio's campaign manager, Ernesto Zedillo, former Minister of Education, as the new PRI candidate for the presidency. Zedillo had been Secretary of Education, a relatively unimportant ministry; he had resigned to run the campaign of Colosio. Zedillo had never held elective office, sharing that trait with De la Madrid and Salinas, but Zedillo was not otherwise experienced politically. He was perceived as a weak candidate. There are speculation that Salinas wished to perpetuate his power as Plutarco Elías Calles had in the wake of the 1928 assassination of president-elect Alvaro Obregón, controlling successor presidents.
Following the election in September 1994, Secretary General of the PRI José Francisco Ruiz Massieu, Salinas' former brother-in-law, was assassinated in downtown Mexico City in broad daylight. The murder was not solved during Salinas's presidency, even when Mario Ruiz Massieu (Francisco's brother) was the attorney general and in charge of the investigation.
The economic bubble gave Mexico a prosperity not seen in a generation. This period of rapid growth coupled with low inflation prompted some political thinkers and the media to state that Mexico was on the verge of becoming a "First World nation". In fact, it was the first of the "newly industrialized nations" to be admitted into the Organisation for Economic Co-operation and Development (OECD) in May 1994. It was known that the peso was overvalued, but the extent of the Mexican economy's vulnerability was either not well known or downplayed by both the Salinas administration and the media. This vulnerability was further aggravated by several unexpected events and macroeconomic mistakes made in the last year of his administration.